Accounting & Implementation

How does the Defense Contract Audit Agency (DCAA) allocate contract costs?

Revolutionary Solutions helps clients allocate their cost principles in accordance to the Federal Acquisitions Regulations (FAR) Cost Principles, Part 31.

What is total cost?

Total cost, including standard costs properly adjusted for applicable variances of a contract, is the sum of the direct and indirect costs allocable to the contract (incurred or to be incurred), plus any allocable cost of money pursuant to 31.205–10, less any allocable credits.

Government Contractors with cost reimbursable, or time and material contracts, are required to submit a Final Indirect Rate Cost Submission within 6 months after the end of its fiscal year.  We can review your government contracts for compliance requirements and calculation of indirect rates.  We can also prepare and submit your incurred cost submissions to DCAA.

Government Approved Accounting Systems

Under cost reimbursable contracts the accounting system must be adequate and approved by the government under FAR Subpart 16.3. There are several elements your system must possess in order to pass ta DCAA System Audit.  One particular element is the requirement that your system is able to segregate direct costs from indirect costs.  Also, you must have written processes and procedures defining the cost structure. Another element is the requirement for a timekeeping system, including written timesheet procedures.  Revolutionary Solutions can go over all the elements in reference to a DCAA audit.  Please keep in mind, you must track all your costs by contract line items, direct cost and indirect cost.


Revolutionary Solutions has supported many clients in implementing their Accounting Systems (including QuickBooks, Deltek GCS and Cost Point, JAMIS ERP Prime) into compliance requirements.  This can involve adding several components to the general ledger accounts and/or creating a plan to achieve a “go live” date of a new or updated system.  Our process begins with project planning, continues into development and integration, and ends with testing and go live.